Major Currency Pairs Continue to Consolidate (Weekly Review)

In the absence of fresh market drivers, volatility in the foreign exchange market remained relatively low over the past week, while the major currency pairs were traded in consolidation ranges. News of the development of a coronavirus vaccine has fueled positive sentiment in stock markets, and gold and the JPY are under pressure from sellers.

Diplomatic relations between the US and China are deteriorating, but the telephone conversation between the trade representatives of the countries, which was positively assessed by the authorities, allowed the AUD to keep from falling below 0.7140, while the growth attempts look more than modest, and the risks of breaking through the support remain high.

The EUR and GBP have tried to break through strong resistance levels paired with the USD, but they still fail. Current supports, in turn, continue to restrain the onslaught of bears, but the longer the bulls are unable to break higher, the higher the probability of losing supports and further development of a downward correction.

Schedule for this week:

Tuesday, August 25
13:00 GMT - USA. House Price Index;
14:00 GMT - USA. Consumer Confidence.

Wednesday, August 26
22:45 GMT – New Zealand. Trade Balance;
12:30 GMT - USA. Durable Goods Orders.

Thursday, August 27
USA. Annual Jackson Hole Symposium.
05:45 GMT - Switzerland. GDP;
12:30 GMT - USA. GDP;
14:00 GMT - USA. Fed Chair Powell Speaks.

Friday, August 28
USA. Annual Jackson Hole Symposium.
06:00 GMT - Germany. GfK Consumer Climate;
09:00 GMT - Germany. Consumer Confidence;
12:30 GMT - Canada. GDP;
14:00 GMT - USA. Michigan Consumer Sentiment.

Author: Anthony Porter, IAFT Analyst